This plea was articulated in a comprehensive report titled "How to Avoid a Debt Crisis in Sub-Saharan Africa," prepared by a team of IMF experts led by Fabio Comelli, a senior economist in the IMF's African Department. The report outlines five strategic steps that African governments, including Nigeria, can take to maintain the sustainability of their public finances while simultaneously advancing their development objectives.

In 2022, Nigeria's fiscal deficit to Gross Domestic Product (GDP) ratio decreased to 5 percent, down from 6.3 percent in 2021. Nevertheless, projections from the World Bank indicate that this ratio is anticipated to climb to 5.4 percent this year and further escalate to 5.8 percent by 2025.

To address this growing trend, the IMF advised Nigeria and other Sub Saharan countries in similar situation to: Set a course by re-anchoring fiscal policy through a credible medium-term strategy; Get ready by undertaking fiscal adjustment to bring debt back to a safer level; Chip in by mobilizing more domestic revenue; Shore up the house by strengthening budget institutions to improve the implementation of fiscal plans; and Getting people on board by anticipating. public resistance to reforms.

On the need to reduce the fiscal deficit, the IMF report said: “IMF staff analysis shows that most countries in the region will need to reduce their fiscal deficits in the coming years. For the average country, the amount of adjustment is about 2 to 3 percent of GDP.

“This adjustment seems feasible given historical experience—in the past, countries in sub-Saharan African countries improved their primary balance by 1 percent of GDP a year over two to three years.

“But not all countries face the same challenge. About a quarter of the region’s economies still have some fiscal space and can use it to maintain and even increase vital investments in human and physical capital. On the other hand, a few countries have very large adjustment needs; for them, it is unlikely that fiscal consolidation alone will be enough to ensure fiscal sustainability. It may need to be complemented by debt reprofiling or restructuring.”